Stocks are rebounding strongly on Thursday ahead of Friday’s big non-farm payrolls report thanks to easing fears over U.S.-China trade tensions. Investors are realizing that opening tariff salvos are unlikely to be implemented. Instead, they are an opening gambit in what’s set to be a long and high-stakes negotiation.
With stocks quite oversold on a technical basis, a short-covering surge has squeezed the bears and put the bulls back in charge. Stocks leading the charge higher include those worst hit by trade fears as well as energy stocks. The latter, flying under the radar lately as big-cap tech stocks got all the attention, are perking up now after a surprisingly steep pullback in crude oil inventories and widespread coverage of the shifting tastes of American drivers back into gas-guzzling SUVs and trucks.
Here are seven stocks leading the way higher:
Stocks to Buy: Boeing (BA)
Boeing Co (NYSE:BA) shares have popped back up and over their 20-day moving average, breaking out of a three-month downtrend, after finding support near their early February lows. The 50-day average is overhead now, a level the stock violated for the first time since May 2017 last month. The violation didn’t last long then. And a short excursion seems to be playing out again now. A return to the late February high would be worth a gain of more than 10% from here.
BA will next report results on April 25, before the bell. Analysts are looking for earnings of $2.55-per-share on revenues of $22 billion. When the company last reported on Jan. 31, earnings of $3.04 beat estimates by 16 cents on an 8.9% rise in revenues.
Stocks to Buy: Caterpillar (CAT)
Caterpillar Inc. (NYSE:CAT) shares looked set for a nasty breakdown on Wednesday as the U.S. and China unveiled their respective $50 billion trade tariff packages. But an epic intra-day rebound pushed shares back into the safety of a three-month consolidation range that’s capped a peak-to-trough decline of more than 20%. A relief rally should see a return to the last February highs, worth a near-14% gain from here.
The company will next report results on April 24, before the bell. Analysts are looking for earnings of $2.07-per-share on revenues of $11.9 billion. When the company last reported on Jan. 25, earnings of $2.16 beat estimates by 38 cents on a 34.7% rise in revenues.
Stocks to Buy: Diamond Offshore (DO)
Diamond Offshore Drilling Inc (NYSE:DO) shares have popped up over their 50-day moving average after finding support at the 200-day average over the past few months. This capped a decline of 30% from the highs set in January. A run back at those levels would be worth a gain of around one-quarter from here. A series of analyst downgrades in January and February weighed on the stock as well, but are fading now.
The company will next report results on May 14, before the bell. Analysts are looking for a loss of 19-cents-per-share on revenues of $296.2 million. When the company last reported on Feb. 12, a loss of 5-cents-per-share missed estimates by a penny on an 11.7% decline in revenues.
Stocks to Buy: Marathon Oil (MRO)
Marathon Oil Corporation (NYSE:MRO) shares are blasting up and over their 50-day moving average and their upper Bollinger Band, closing down the 25%+ decline from the January highs. This as crude oil blasts above the $60-a-barrel level. The stock also recently enjoyed an upgrade from JPMorgan analysts, who raised their rating to buy from neutral.
The company will next report results on May 2, after the close. Analysts are looking for earnings of 12-cents-per-share on revenues of $1.3 billion. When the company last reported on Feb. 14, earnings of 7-cents-per-share beat estimates by 5 cents on a 23% rise in revenues.
Stocks to Buy: Valero (VLO)
Valero Energy Corporation (NYSE:VLO) is popping up and out of its three-month consolidation range, threatening to retest the highs set back in January. Shares rallied some 50% from their lows last summer as relatively stable gasoline prices along with ongoing pressure on crude oil have boosted the so-called “crack spread” and boosted profitability.
The company will next report results on April 26, before the bell. Analysts are looking for earnings of $1.11-per-share on revenues of $23.6 billion. When the company last reported on Feb. 1, earnings of $1.16-per-shear beat estimates by 8 cents on a 27.4% rise in revenues.
Stocks to Buy: Halliburton (HAL)
Oilfield services play Halliburton Company (NYSE:HAL) has seen shares stagnate for years as lower energy prices put a cap on drilling and production activity. That could be set to change now, and investors are responding by pushing shares back up and over their 50-day moving average exiting a three-month consolidation range. Support lies just below at the 200-day average. A return to the January high would be worth a gain of 20%+ from here.
The company will next report results on April 23, before the bell. Analysts are looking for earnings of 42-cents-per-share on revenues of $5.76 billion. When the company last reported on Jan. 22, earnings of 53-cents-per-share beat estimates by 7 cents on a 47.7% rise in revenues.
Stocks to Buy: Chevron (CVX)
Chevron Corporation (NYSE:CVX) shares, like many of the others here, are rising back over their 50-day moving average and look set to a multi-month consolidation range with an upside breakout. Early last month, management reaffirmed their fiscal 2018 guidance on stronger upstream cash margins and production growth.
The company will next report results on April 27, before the bell. Analysts are looking for earnings of $1.49-per-share on revenues of $41.18 billion. When the company last reported on Feb. 2, earnings of $1.64 beat estimates by 40 cents on a 19.4% rise in revenues.
Anthony Mirhaydari is the founder of the Edge (ETFs) and Edge Pro (Options) investment advisory newsletters. Free two- and four-week trial offers have been extended to InvestorPlace readers.
